Q

It’s really interesting when companies like Apple have factory workers committing suicide due to horrible working conditions, we sit here and wonder why China has not developed into a nice democracy like the US. If American companies had cared about something other than profits, they could have possibly strengthened workers’ rights/ influenced workers. It makes me wonder if a more powerful working class could have led to a much better China. Apple pays an engineer in China $400/month. And even more sickening is the fact that semi-conductor workers are knowingly exposed to carcinogenic materials. Truly nothing good comes from exploiting other people. It’s really quite interesting the role the West has played in keeping the Chinese worker a vulnerable powerless class. The West and the Communist party have worked hand in hand to make this happen.

Christine have you ever thought about who really benefited from the US dollar being the world reserve currency??? Hmmm??? Was it the millions of average Americans who lost their good paying jobs to China & other third world workers/slaves, in exchange for what - unsufferable predatory debt and cheaper flat screen tv's? Was it black Americans who benefitted from all the the social programs created to help them in Johnson' Great Society - have they been lifted out poverty?? Was it the millions of people around the world who have been murdered since the end of WW2 because their leaders dared to disagree with US policy??? Was it the US soldiers who have fought in these illegal wars and died or have come home missing limbs and with PTSD's?? The US dollar being the world reserve currency has served the following: Global Banks, Multinational Corporations, and the military industrial complex and that is why it was given this status in the first place. The United States military which has caused so much pain and suffering around the world would not be able to do what it has done had the Federal Reserve not been allowed to print money out of nothing. The Dollar should have lost it's status in 1971 when Nixon closed the gold window. And FYI Keynes knew that no sovereign currency could serve as both a domestic currency and a world currency and he objected to the US dollar as the world currency at the Bretton Woods Conference and he was over ruled. The United States is a deindustrialized nation of debt slaves because of the US Dollar being the world reserve currency and I don't see that as a benefit.

I am not disagreeing with Kathleen S. but I don't think the initial strategy was as premeditated or nefarious as her comment implies. Keynes may have seen problems but Triffin's dilemma had not been proposed and most people did not see the future problems. The US got a lot out of it and lost some things in the process. The issues now are what is going to replace the dollar (China certainly wants to and is making moves in that direction but there are many reasons it cannot be a global reserve currency, though it may develop a sphere of influence; SDRs are a more logical choice but I am not sure how much this is being discussed). The second issue is how can we plan for and mitigate some of the dangerous dislocations that will arise as we slowly loose that status.

As a PPS, it should be noted that we are appalled by factory work in China (though most people work in those factories, save some money and leave), those factories lifted millions of Chinese out of abject poverty and left Chinese workers much better off than they were.

Yes, China has developed a middle class. But 40 percent of its population lives under $5/day. Have we improved their lives? American chip makers knowingly took their manufacturing out of Silicon Valley to China, full well knowing those workers would develop cancer and their children would develop birth defects. I’m not a fan of the Chinese government, but it’s really hypocritical for people like Kyle Bass to complain about IP transfer and human rights violations in China, when in fact American corporations have profited so dearly from them and were in the best position to require humane working conditions. Where is corporate responsibility in all of this? The original argument against globalization twenty years ago was that it would be a race to the bottom for workers. This has clearly proved to be true.

European leaders have wisely decided that what's more needed is an American containment strategy. Like the EU Finance Head announced last month at the UN in conjunction with their Iranian and Chinese allies; top priority and deployment of an EU-Chinese payments system to replace/neutralize SWIFT as the US has weaponized it against Iran and now Europe. Huge US error. Germany and Europe have been increasingly appalled & vocally outraged by US policy lately, and they've raced into the arms of China with agreements ranging from prioritizing a massive High-Speed Rail project to link Germany & China ASAP (already under construction now) to the aforementioned de-dollarization objective they now share.

I agree with David R. - President Xi started with the slogan "Make China Great Again." I think that the US administration policies and tariffs are just making it easier to make China great again. It is earlier than China may have wanted, but do not look a gift horse in the mouth. China's biggest problems are trying to figure out what the US administration really wants and managing its debts. DLS

The EU is only standing on one leg and with no standing army. The chinese rails to europe ROI is negative. The Chinese Communist Party's ratio of debt to GDP is far beyond the US's 4%. The yuan is so unstable that less than 1% of transactions that occur world wide is in yuan. How would the yuan replace the swift system?? How much more can they internally borrow from itself? ( A lot😂) The Chinese love China, but hate the CCP. How long can authoritarian force maintain order? Until the next significant downturn in mho.

totally agree, seems like an editing fail.

Try and make comments that add value Adam. Maybe you think this note drags Kyle down. On reading it, the only person it reflects badly on is yourself. Let’s all drag ourselves up, not down.

Interesting. Another "Adam G." is praising this interview right below...changed your mind? Anyways, a distasteful comment aiming at one of the most brilliant guys around the RV platform/crazy track record. Just keep it to yourself next time around, zero value add and chat pollution.

Wow, this is strange, it appears someone had hacked my account or there are two people of the same name.... the above negative comment was not posted by me, I did post a comment on Oct 5th as can be seen below. If RV could please contact me, you have my email on file, I would like to get the situation resolved... and I hope this does not happen to anybody else. I am a charter member and have the great respect for all that RV provides.

Hello everyone - The comments posted by Adam G's are indeed from different people and it so happens that they have the same initial. As the community is growing bigger and bigger we will be working on a better comment system that will help with these confusions.

Lets not confuse Kyle's insights with his inability to produce profits for his investors.

Translation: "I wish I could be as cool as Kyle!"

Re "If I have missed something in my review I am open to reconsider but this is my current opinion fresh after watching," what you missed is the long arc of history. An arc that can be studied as it's played out many times in the past few hundred years. This same arc was first documented about 2,000 years ago. The key takeaway is: when one great power threatens to displace another, war is almost always the outcome; but, it doesn’t have to be. Buy a used copy of the book and at least read Part 4 and the conclusion, or Part 3 on.

Following your logic, suppose CRISPR Therapeutics teamed up a major winnwirth a Pfizer or the like, and has to spend z. Over $500 billion doing so over a long period of time

If there is no right to intellectual property, no one would have any financial incentive to invent, write, or create anything, since the hard work of doing so would just be stolen by the vagabonds of the world. I am shocked that someone on this site would have this opinion of intellectual, or any other property.

Sid: Lack of US Big Legal IP muscle behind them never stopped the Wright brothers, Pasteur, nor Beethoven. BTW physical property is way different than intellectual property. IP equates to ideas, and if you stifle ideas, you stifle freedom and innovation. Emma: there is a big difference between providing IP protection in your own country (which Allison and the US have a perfect right to advocate and do), and forcing your domestic patents on other countries.

Nobody in Singapore is making any decisions on the basis of us all 'living on/in one world'. Quite the opposite.

Michael, he merely said that Singapore is an example of an authoritarian country outperforming a democracy. And he is 100% correct as Singapore is vastly superior to USA by every macroeconomic benchmark by a huge margin, proportionately of course. Extremely impressive given that only 50 years ago it was an impoverished, malaria-infested, worthless island, even poorer than black Jamaica before. It's also 90% Chinese and the blueprint/model of what China began copying/modeling under the great leadership of the anti-Maoist Deng Xiaoping. In contrast, today the US is increasingly embracing the same Marxist and anti-trade policies that China did as it quickly fell from the most rich & powerful nation in the world to poorest & weakest. We're now seeing reversion to the norm again, like it was for 2,000 years while China was #1, and anyone trying to stand in the way will get crushed and destroyed (watch and see). By the way, with all due respect, Mr Bass has been wrong on China for many years, losing a fortune for anyone following his awful China investment advice, and he's clearly ignorant about the region and culture. He's never lived in Asia and isn't descended from there so it's no surprise he's clueless about it.

Really interesting comments that got me thinking, many thanks.

China doesn't want that kind of leadership that you talked about... Historically it only wants to have a sphere of influence in its local region. The world will exist in a multi-polar world where multiple countries will have to learn to work together for a better humanity. Trump is retarded, he is destroying global order from within. He is causing a political civil war within the country that may lead to violence at some point and he also makes U.S allies question their alliance with the U.S. His trade wars will likely lead the world to a dark path. Russia did a asymmetric cyber attack and won big on this one without firing a shot.

Z KHZMXX M

James, did you have a lobotomy?

thanks for sharing Dave

Somebody really put a thumbs down to this comment of mine? I mean seriously?

I enjoy your sense of humor.

cc w. Thanks. With five thumbs down humor is a good thing even if it is tongue in cheek. The probability of a win/win outcome in this tariff war is less than 10% for sure. That leaves a 90% outcome for a win/lose or a lose/lose case. I think that China is playing chess while we are playing checkers. The US has more power, but China has more time. It seems that a lose/lose outcome is the most probable for both. I just do not like it. DLS

Terry, Which ones are war mongers. I ask that because I can’t tell the difference.

Oh just got it, you must be talking about the people that sacrifice their lives and blood to afford you the freedoms You have!

I bet you've only visited certain parts of Shanghai and very small part of it. Last time I traveled there (I visit the not so glorified parts of Shanghai often as well) I don't think see where the city is harnessing technology and clean energy as much as other places I've been to in other parts of Asia or here in the US. There is a reason why most better off Chinese wants to move to the US and have second home here. I do agree the younger generation of Chinese are extremely competitive and do have good work ethic. But having worked in the tech industry here in the US I also experienced people here often work pretty hard as well. Motivations are different. They (Chinese) do study harder but they lack creative thinking. Not saying they won't get there though. IMHO.

Hi Sophie, it is wonderful to be able to communicate with someone like yourself through RV. I have one question and one comment. Firstly, I am Canadian (non warlike) and was raised in Vancouver which is now almost a Chinese city. In your opinion, why have so many wealthy Chinese chosen to get out of, at least partially, their country. As for your comment on Western complacency you are exactly correct. I am a grandfather now and I want my grandson to go to Chinese school as I believe the 21st century belongs to China.

Hi Bryan, I may butt in to help answer your comment/question: scale. China has 1.3bn people. If even just 1% of Chinese migrated elsewhere, that is 13 million people. A city of 10 million people in China is considered a smaller/medium sized city. Also consider the large number of native Chinese in other Asian countries - Singapore, Malaysia, Thailand, Indonesia, etc. There is a saying in China (paraphrasing) that if you are special, there are 1000 others just as talented as you are. If there are wealthy Chinese living in Vancouver, you can bet there are many multiple more wealthy Chinese choosing to stay in China.

From your comment its obviously you've no understanding (or perhaps you bought into the Chinese propaganda) of the risks China will take to force a take over of Taiwan. I don't think they're that kind of risk takers.

Excellent point. Realpolitik. People were clearly just as smart and creative in the 12/16 incidents over the last 500 yrs that did lead to war. Only difference between those events and the cold war was MAD. That made people smarten up! So the real game is really just slowing down China's growth as part of a comprehensive pushing back against their imperialism. Much of this is already in the bag: 1. declining cohorts of young males will lessen their belligerence 2. Their refusal to restructure away from FAI and SOEs and toward the consumer will keep them firmly in the middle income trap (ie: poorer than otherwise) 3. We have seen this movie/s before, making this CW2 (cold war 2) in one sense and in another Japan mark 2 (state led Asian industrialism). Expect the slow relative decline of China to become more obvious.

Reminds me of an old story of when the President De Gaulle of France at the time visited Chairman Mao and asked his opinion of the French Revolution, Mao replied "too early to say..."

RV has a series on the changing world and investment implications, and it comes up in so many interviews. And is planned in Part 2. The lack of exercise of wisdom at the highest levels of the functioning of the U.S. government is perplexing. It's flummoxing how quickly the pace of U.S. hegemonic decline has seemed to become. The economic consequences.... The 'There is no comprising the American standard of living' was a cliche until maybe about 2001. No one can explain why the elites are not taking more care of the privilege the U.S has. Druckenmiller touched on this in his RV interview. A further lesson freom at large is that Tweets and bellicose rhetoric do matter, they do cause harm. I wonder which of the blunders will in longer-term be considered worse compared to what we think of them now. The U.S. letting the relationship warm between Russia and China comes to mind. Another is running record deficits while at full employment. Oh vey.

didn't disappoint.. *